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Develop an Improvement Strategy
Define objectives and plan steps to increase your chance of success
Coach Vince Lombardi of the Green Bay Packers once said: "It's hard to be aggressive when you don't know who to hit." Growing your business, entering new markets, converting to digital manufacturing, or simply fixing the pressing problems of the day all have one thing in common: You need a plan. Without that plan, your chances of success are greatly diminished. So what does a plan look like?
You should start with a clear and realistic statement of objectives. "I want to double my business in 2 years" is a vision, not an objective. But what does "double my business" mean? You want more sales, but it's important to recognize that getting more sales does not necessarily translate into more profit. A better statement will be more specific, such as, "I want to increase my revenues by 10% per year and maintain a 25% average profit margin for the next 3 years." While business growth has been used as an example of an objective, the concept of a well-defined objective applies to any project, whether it is reducing remake rates or setting up a formal training program for your employees.
Once you have decided on the objective, the next step is to determine a strategy-the plan of action that will deliver that objective. A strategy generally involves setting goals, determining actions to achieve the goals, and mobilizing resources to execute the actions. To continue with the example, profits can be increased by improving asset productivity and doing more with existing resources, and revenues can be increased by improving customer satisfaction, such as by providing better first-time quality and service or reducing remake rates. Whatever the project, your plan of action must reflect a workable strategy that will result in achieving the stated objective.
Now comes the fun part of your plan-development and execution. There are four areas to be addressed as part of your plan deployment: business planning, measurements, culture, and methods/tools. Each requires its own set of considerations.
You currently have two types of markets-existing clients and potential new clients-each of which has its own positives and negatives. Exactly which of your current product lines are you planning to focus on to increase revenue? Conversely, is it a good idea to look at new products that you don't currently offer your customers? What issues exist within your current operations that could prevent you from achieving your objectives?
Measurements of the progress of your strategy are required; how else are you going to know if you achieved the objective? These quantifiable performance statements should follow certain guidelines. Measurements should be relevant to the goal and strategy; placed in context of a target to be reached in an identified time frame; capable of being tracked period after period; and owned by the person who is responsible for the goal.
Employees today are looking for a purpose to their work that is easily identified, outwardly directed, and makes a real difference. It is vital that the employees have ownership in the plan's strategic execution. When employees join executives in truly owning the responsibility for business success, an exciting new sense of teamwork takes hold.
Choose your tools. There are numerous tools at your disposal to deliver your strategy, but you will need to select, learn, and apply a chosen few. Focus on getting good at a few tools, and then expand your skills to include those methods and tools that will also support strategy execution. For example, if you want to increase asset productivity, a robust training program to cross-train technicians is good idea. Later on, you can expand to a "train-the-trainer" program that allows the employees to train each other.
Making improvements to your business requires careful thought and a workable plan. Of course, you can always keeping doing what you have been doing-but then you will find yourself right back where you started.
About the Author
Bob Yenkner is the owner of Practical Process Improvement in East Hampton, CT.